Abstract:Private healthcare financing contributes just over half (52-54%) of all healthcare expenditures in Sri Lanka. The bulk of private spending is direct spending by households. Private insurance contributes about 5% of total private financing, with the private insurance market showing considerable growth in recent years. Private spending is mainly used to pay private hospitals, doctors and laboratories, and to purchase medicines from pharmacies. Private hospital provision has shown robust growth during 1990-2011, increasing more than 120% to reach an estimated 4.210 beds, 266,000 discharges and revenues of Rs 19 billion in 2011. However, the private sector share of discharges increased only from 3.9% to 4.6% in this period. This growth is concentrated in the Western Province, with private hospital provision in the Western Province accounting for 65% of all private beds and 88% of all private hospital revenues in 2011.

It is possible to profile private sector activity in Sri Lanka in greater detail than in most other regional countries, by making use of data collected outside MoH. This is despite the inability of the PHSRC to provide reliable statistics on private sector activities. The findings indicate that MoH can improve its monitoring of the private sector health contribution by strengthening partnerships with other agencies in the country, although restructuring the private sector regulatory mechanisms would also make a big difference.